Another period of heightened volatility in the markets reminds us why tax management can be such an essential part of fixed income investing.
Parametric’s tax optimized ladders (TOL) solution may help to enhance after-tax yield by seeking to optimize the allocation between tax-exempt and taxable bonds, based on an investor’s own tax rate and the relative value between sectors.
Reflecting ongoing uncertainty around inflation and the trajectory of monetary policy, yield volatility posed challenges in 2024. Yet it also highlighted the importance of tax-efficient strategies like loss harvesting in fixed income portfolios.
